Chevron Corporation declared the award of major front-end engineering and design (FEED) contracts for the Gendalo-Gehem natural gas development in East Kalimantan, Indonesia.

The Chevron-operated Gendalo-Gehem project is located in the Makassar Strait offshore East Kalimantan in water depths of approximately 6,000 feet. The project will include two separate hub developments, each with its own floating production unit (FPU), subsea drill centers, export gas and condensate pipelines and an onshore receiving facility. Gas from the project will be used both domestically and also converted to liquefied natural gas (LNG) at the Bontang LNG facility in Indonesia for export. Maximum daily production from the project is expected to be 1.1 billion cubic feet of natural gas and 31,000 barrels of condensate.

Chevron's Indonesia subsidiary awarded the contract for the FPUs to PT Technip Indonesia; the contract for the subsea and flowline system to PT Worley Parsons Indonesia; the contract for the export pipelines to PT Worley Parsons Indonesia; and the contract for the onshore receiving facility to PT. Singgar Mulia.

"Awarding these contracts moves the Gendalo-Gehem project closer to commercialization. The completion of this project will strengthen our regional portfolio of major gas projects and enhance our position as a leading supplier of natural gas and LNG in the Asia-Pacific region," said George Kirkland, vice chairman, Chevron.

Jim Blackwell, president, Chevron Asia Pacific Exploration and Production, said Chevron welcomed the opportunity to partner with Indonesia in developing the country's first ultra-deepwater natural gas project.

"Chevron has been a key part of the energy sector in Indonesia for more than 80 years and we are committed to assisting the country in developing its resources, and meeting the growing demand for natural gas in Indonesia and the region."

Chevron currently has an 80 percent interest in the project and is seeking regulatory approval for a partial farm-down of the holding.

Tags: Chevron Corporation